Box 3 & Your Holiday Home In Spain:
What's Really Going On?

Every month we see Dutch owners who have been misinformed about this. Often not through incompetence, but because a Dutch tax advisor knows the Dutch rules inside out while being less familiar with the Spanish side — plus the tax treaty between the two countries. The result: confident statements that turn out to be just slightly wrong. Time to lay it out calmly.

The starting point

Yes, you declare the property in Box 3

Are you a Dutch tax resident and do you privately own a Spanish holiday home? Then that property is part of your wealth in Box 3 and you declare it on your tax return. You don't use the WOZ value for this, but the value in economic transactions: the market value on sale, as of January 1.

The property falls into the category 'other assets'. In 2026, the Dutch Tax Authority calculates this using a deemed return of 6.00% — significantly higher than the 1.28% that applies to savings. Keep that difference in mind; it matters later.

The treaty

Spain has the right to tax, the Netherlands grants relief

The tax treaty between the Netherlands and Spain states that Spain has the right to tax real estate located on Spanish territory. To prevent double taxation, the Netherlands grants a double taxation relief. The value of the Spanish property is then deducted again from your Dutch Box 3 tax.

So directly, you pay (almost) no Dutch Box 3 tax on the property itself. So far, the popular story holds up. But there are two catches.

Catch 1

The relief is a proportional fraction

The Netherlands applies the proportional method with progression reservation. In plain terms: you receive relief proportional to the share the Spanish property represents in your Box 3 return. Because of how the tax-free allowance is divided, in practice the relief regularly falls just a bit short — meaning you still end up paying double tax on a small amount.

Catch 2 — the most important one

Your property makes your savings taxable

The value of the property counts first when determining your total wealth. Because of this, you can end up above the tax-free allowance — and start paying tax on savings that would otherwise have remained untaxed.

And in Spain?

What you'll pay there regardless

• IBI Municipal property tax. Annual, depending on location and value.
• Modelo 210 Non-resident tax (IRNR). Must be filed annually before December 31 — based on deemed personal-use value or actual rental income.
• Patrimonio Wealth tax, varies by region. Comunidad Valenciana: exemption up to €1,000,000 for non-residents.

Looking ahead

Note: 2028 changes the rules

The Box 3 system is expected to be overhauled as of January 1, 2028, with the Actual Return Act (adopted by the Dutch House of Representatives in February 2026). For real estate, this introduces an addition of 3.35% of the value for personal use, as well as a capital gains tax upon sale.

In addition, the Netherlands and Spain are working on a new tax treaty. Whether the current exemption method will be preserved is not yet known. All the more reason to run the numbers carefully before buying.

This article is intended as general information and does not constitute tax or legal advice. Amounts and percentages apply to tax year 2026 and may change. Always have your situation calculated by a qualified tax advisor with knowledge of both Dutch and Spanish law.